Daily Tax Update - March 08, 2006

TAX RECONCILIATION BILL CONFERENCE MAY NOT BEGIN UNTIL PENSION BILL PASSES:
Yesterday, Senate Finance Committee Chairman Charles Grassley (R-IA) said that the tax reconciliation conference committee is unlikely to convene this week. Grassley also indicated that it would be "impossible" to conclude the tax conference before the next recess, which begins March 20. Grassley said, "The pension bill really has to be passed before a tax bill has to be passed, although I'm not trying to put them in that order." Grassley added, "We don't have to get the tax bill done until the Fiscal Year 2007 budget resolution, but we need to get this pension bill done by April 15." Both the House and Senate passed differing versions of pension reform legislation in 2005, but the conference committee to reconcile the differences in the pension bills has not met. Grassley added, "There is a problem with pensions and reconciliation going together. I suppose it depends upon how much our staff can do and how much we have to do, whether they can be done simultaneously."

  • After this week, there are three legislative weeks remaining before the Easter recess begins the week of April 10. The one-week St. Patrick‚Äôs Day recess starts March 20.

JOINT COMMITTEE ON TAXATION RELEASES COMPARISON OF HOUSE AND SENATE PENSION REFORM BILLS:
Today, the Joint Committee on Taxation released the comparison of the provisions of the "Pension Protection Act Of 2005" as passed by the House and the "Pension Security And Transparency Act Of 2005" as passed by the Senate.

  • The document can be accessed here

TAX BILLS INTRODUCED MARCH 7:

  • H.R. 4884 sponsored by Rep. Mark Kennedy (R-MN) would include in gross income the value of assets set aside under an employer nonqualified deferred compensation plan when the employer defined benefit plan has a funding target attainment percentage of less than 80 percent.
  • H.R. 4887 sponsored by Rep. Shelley Berkley (D-NV) would exclude from gross income amounts awarded to qui tam plaintiffs.
  • S. 2379 sponsored by Sen. Richard Burr (R-NC) would allow a deduction for health and long-term care insurance costs of individuals not participating in employer-subsidized health plans.

INTERNAL REVENUE SERVICE - CIRCULAR 230 DISCLOSURE:
As provided for in Treasury regulations, advice (if any) relating to federal taxes that is contained in this communication (including attachments) is not intended or written to be used, and cannot be used, for the purpose of (1) avoiding penalties under the Internal Revenue Code or (2) promoting, marketing or recommending to another party any plan or arrangement addressed herein.

STEPTOE & JOHNSON LLP - TAX PRACTICE
Steptoe & Johnson LLP has one of the largest and most diverse law firm tax practices in the country. The practice covers the entire spectrum of federal taxation, including representation of businesses before the Congress, Treasury and the national office of the IRS; transactional planning for domestic and multinational corporations; complex audit and controversy work for corporations and other business interests contesting IRS adjustments; litigation before the Tax Court, Court of Federal Claims, district courts, courts of appeals and the Supreme Court. The firm's tax practice also encompasses all aspects of employee benefits (ERISA), executive compensation, tax-exempt organizations and charitable giving.  Steptoe has an extensive state and local tax practice, representing an array of business clients on complex sales and use tax, corporate income tax and property tax matters, both advising those clients and handling audits, administrative appeals, and litigation for them.  Read  more information on Steptoe's tax practice